S&P Upgrades Oman's Outlook to Positive from Stable ... Affirms Credit Rating at BB+/B

Standard & Poor's credit rating agency revised its outlook for the Sultanate of Oman to positive from stable, indicating that the Sultanate's financial situation is improving.

The agency confirmed its credit rating for the Sultanate at BB+/B.

In January, Oman expected a budget deficit of 640 million riyals ($1.66 billion) in 2024, a shift from a surplus in 2023 due to the impact of lower oil production and prices on public finances.

Oman, like its oil and gas producing neighbors in the Gulf, is seeking to diversify its sources of income and economic sectors away from oil and gas, but it remains largely dependent on oil revenues.

The Sultanate of Oman’s Vision 2040, an economic development plan launched in 2021, envisages reducing the share of the oil sector in the gross domestic product to 16% in 2030 and to 8.4% in 2040, down from 39% in 2017.

“The government’s balance sheet will improve and the economic reform program could lead to faster-than-expected debt reduction in many state-owned companies without affecting economic growth results,” Standard & Poor’s said in a statement.

Standard & Poor's expects the Sultanate of Oman's real GDP growth to average 2% annually between 2024-2027.

In September 2023, Standard & Poor's raised the Sultanate's credit rating to BB+ thanks to stronger macroeconomic fundamentals.